Archives for December 2015

Enforcing noncompetition agreements and other restrictions on post-employment activities is always a challenge in Massachusetts courts. Among the various issues employers must consider before attempting to do so is one that is often overlooked – the question whether a valid and enforceable contract even exists.

The general rule has long been that older contracts are eviscerated by new ones covering the same subject matter. This is true in noncompetition situations as elsewhere and can become an issue when an employee is promoted or otherwise enters a new employment agreement. Unless a previously signed restrictive covenant is expressly referenced or restated in the new contract, it may be null and void. This principle was recently restated in a U.S. District Court case, where a 2005 noncompetition agreement was nullified by a 2012 employment contract.

Best practices in the noncompetition area demand diligence on this and related issues. Whether or not a new writing is created for an employee – remember, even oral contracts can be enforced in this area if real job changes occur – companies that may wish to enforce restrictive covenants against former employees should institute a regular review program. Each time an employee is promoted or gets substantive new duties, a new noncompetition form should be executed. The same makes sense after the simple passage of time, which can bring smaller, incremental changes that might threaten an employer’s ability to enforce older covenants.

It has not become law yet and there’s no assurance it will make it through this Legislative session, but a bill that would outlaw “workplace bullying” is making progress. The fact that the current version of the proposed law, which has been considered in various forms in the past, is sponsored by more than 50 members of the House of Representatives is one sign that this time things may end differently. Another is the positive report it received in August by the committee on Labor and Workforce Development.

The law would open employers to liability for permitting an “abusive work environment” to exist, making them liable for the acts of their employees. It defines such environments as ones where abusive conduct has caused physical or psychological harm to an employee. Repeated verbal abuse, intimidating or humiliating behaviors, and sabotaging of an employee’s work fall within the ambit of abusive conduct under the proposal’s definition. Among the possible sanctions for workplace bullying: an injunction to stop it, job reinstatement of a victim, termination of an offending party, wage losses, emotional distress and punitive damages, and legal fee awards. Employees would have to bring a private suit for bullying within a year of the most recent workplace event.

As justification for the law’s passage, sponsors recite that one-third of all Massachusetts employees will experience “health-endangering workplace bullying” that can cause shame, humiliation, severe anxiety, depression, and even suicidal tendencies, among other things. They note that bullying not tied to membership in a legally protected class of individuals is four times more prevalent than sexual harassment and opine that victims of it should not be shut out from relief. The proposal’s goals, its sponsors say, are to provide relief for employee victims of bullying and incentives for employers to prevent it from occurring.